IRS Mileage Deduction Amount to Increase July 1

The IRS has responded to the high price of gas by raising the allowable per-mile deduction amount. Starting July 1st, the per-mile rate is increasing from 50.5 cents per mile to 55.5 cents per mile.

If you’re like me, you track your business mileage versus personal mileage, and take a deduction. This is one of my favorite deductions as a business owner. It’s a deduction for my business, but it’s not considered taxable income to me personally. I’ve got an older vehicle that gets pretty good gas mileage, so it works out okay.

To make sure you get this deduction, though, you need to:

  • keep a notebook or smartphone app handy to record mileage
  • make a note of mileage when you get in your car, and again when you’re done
  • keep some kind of paper log with dates, distances and purposes of travel, that you can produce if you’re ever asked

This is one of those things that the IRS will always ask for any time they are questioning your deductions or return. If it’s incomplete or incorrect, you risk losing the write-off completely.

There are many variables when you’re structuring a business. That’s why it’s hard to go through a quick-service website. Unless you talk to someone who’s got some knowledge and experience on both the tax and the legal side, it’s hard to know what you don’t know. And that can leave you vulnerable.

Got questions? Contact us! We’re here for you.

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